What has happened since the beginning of the year is not an exaggeration to say that it has been an eventful spring. Especially after Vision Pro detonated the Internet a little, Meta came to another wave of big business adjustments, which set off a lot of storms, for details, you can see "Meta's ambition: "de-Androidization", do Meta itself".
At this time, in April, it has also entered the time when most listed companies make their financial reports public, and today, Meta has made its financial reports public.
Overall, revenue rose 27% from $28.65 billion in the year-ago quarter, the fastest pace of expansion in any quarter since 2021. Net income doubled from $5.71 billion, or $2.20 per share, to $12.37 billion, or $4.71 per share.
One obvious reason for the increase in net profit was that sales and marketing costs were down 16% compared to the same period last year.
In the conference call and financial report, the overall revenue of Reality Labs is also reflected.
Reality Labs, Meta's division responsible for VR headsets, AR glasses, wearables, and related software, has been a major investment project for Meta in recent years.
According to the report, Reality Labs sales in the first quarter were $440 million, an increase of 30% over the same period in 2023. During the call, Meta's chief financial officer, Susan Li, said that this record revenue was mainly due to the sale of Meta's headset hardware.
Historically, the revenue of 440 million is 36% lower than the $695 million in the same period in 2022 and 18% lower than the 534 million in the same period in 2021, accounting for only about 1% of Meta's total sales in the quarter. This shows that while the Quest 3 brings good sales figures, it still hasn't surpassed the momentum and long-term results of the Quest 2.
On the cost side, Meta managed to reduce quarterly costs by 1% while increasing revenue by 30%, indicating that Reality Labs is on track to become profitable. This could also indicate that the Quest 3 is subsidized less than the Quest 2.
According to CNBC, Reality Labs has accumulated losses of more than $45 billion since its separate report in 2020. In response, Susan Li said that these losses are expected to continue to increase significantly over the next year due to "ongoing product development efforts and our investments to further expand the ecosystem."
Mark Zuckerberg has told investors in the past that he doesn't expect Reality Labs to be profitable until 2030 and sees it as a long-term investment in the future of computing.
Zuckerberg is ready for a long battle and has a full psychological build-up for Meta's shareholders. And its current biggest competitor, Apple, is also adjusting the marketing strategy of the Vision Pro in a timely manner according to market feedback.
According to the forecast of the famous analyst Ming-Chi Kuo, because of the sharp decline in sales in the United States, Apple will adjust its sales forecast before launching the Vision Pro in non-US regions. At present, it is expected to reduce shipments to 400,000-450,000 units. He also said that this may affect the market direction of Pancake, Micro OLED and MR headsets.
In addition, he also mentioned that sales are less than expected, which will also affect Apple's pace of launching the new generation of Vision Pro, and it is currently expected that no new Vision Pro will appear in 2025.
Overall, Ming-Chi Kuo's analysis is based on "Apple's production cut is due to weaker-than-expected demand in the United States", however, some media commentators said that Apple's sales adjustment is largely related to Sony's Micro OLED production capacity.
According to previous reports from the Financial Times, The Information and The Elec, the production of Vision Pro is severely limited by Micro OLED capacity, and supplier Sony can only produce enough Micro OLED for less than 500,000 headsets by 2024. Therefore, the media believes that Ming-Chi Kuo's speculation is not entirely credible.
It is worth noting that, first of all, Apple has been actively looking for other Micro OLED suppliers to alleviate the problem of Sony's limited production capacity.
In addition, Apple is facing unprecedented sales pressure due to the long experience process set up by Apple and the excessive attention of the outside world to the high price of $3,500, so it is not difficult to understand the production cut.
However, judging from the two news, Apple and Meta are not only competitors to each other, but also "allies", and both are facing strong pressure from the consumer market